Insurance Personal Financial Management

Insurance and Risk Management Introduction Activity: With a partner. Read p. 501 Explore Insurance Options. 1. Create a list of property he owns and determine an approximate replacement value 2. Choose three companies that offer renters insurance and compare what each company covers and the costs of coverage 3. Use a spreadsheet to compare your findings. 4. What company did you choose?..why??!?!

Assignment Read p Answer questions 1-4 on p. 511

Home and Property Insurance

Homeowners Insurance Coverage that provides protection for your residence and its associated financial risks, such as damage to personal property and injuries to others.

Building and Other Structures Covered under a homeowners' policy detached structures on your property, such as a garage or tool shed

Household Inventories If something happens to your personal property, you must provide how much it was worth. List or other documentation of personal belongings, with purchase dates and cost information. Form obtained from insurance agent

Additional Property Insurance Valuable items may need added protection Examples: jewelry, computers, musical instruments Personal Property Floater - additional property insurance that covers the damage or loss of a specific item of high value. Specific description and value proof

Personal Liability and Related Coverages Amounts of Coverage Specialized Coverages

Amounts of Coverage Basic homeowners policies cover $100,000 Umbrella policy - supplements basic personal liability coverage Extended liability policies are useful for the wealthy and business - sold in the amounts of $1 million or more Medical Payments Coverage - pays the costs of minor accidental injuries to visitors on your property.

Specialized Coverage Floods or earthquakes – not part of homeowners policy May be mandatory where you purchase your home National Flood Insurance Program

Actual Cash Value The payment you receive is based on the replacement cost of an item minus depreciation. Depreciation - loss of value of an item as it gets older

Replacement Value You receive the full cost of repairing or replacing an item. Depreciation is not considered when settling the claim. More expensive coverage than actual cash value